Unemployment Claims Spike

Same story, different week

Last week, new unemployment claims increased for the second week in a row, reaching their highest point since November 2009. At the same time, shipments and new orders of durable goods were weak as the economy continued to struggle toward recovery. For people without jobs — especially those who weren’t able to make ends meet and had been relying on unsecured loans and pay day loans to get by even while employed — this is nothing but more of the same old bad news. Not that the typical laid-off worker struggling to put food on the table would really care, but this most recent unexpected spike in unemployment claims has had a discouraging effect on US stock markets.

The biggest increase in more than three months

According to a new Los Angeles Times online article, new orders for manufactured durable goods, not including transportation equipment, slipped again in January, this time by 0.6%, after having increased by 2% in December 2009. At the same time, the Labor Department reported that the overall number of workers filing claims for unemployment benefits increased by 22,000 last week, to 496,000, up from 474,000 the previous week and the highest level in more than three months.

California gains, Kentucky loses

The bad news wasn’t uniformly distributed across the nation, however. California, for example, had a significant decrease in its number of unemployment claims. California unemployment claims were down by with 5,540 at the end of last week, a reduction attributed to fewer layoffs in the service industry. Claims filed by Kentucky workers, on the other hand, jumped by 2,510, due in large part to a new round of layoffs in auto and manufacturing industries.

Those statistics are people

When it comes to unemployment, numbers and statistics are everywhere, but they carry no particular meaning for the people who are those numbers and statistics. Workers aren’t just being laid off for the proverbial lack of work. Workers are being laid off in more insulting ways. A good example is the abusive employers that lay off workers only to hire other, more desperate unemployed workers to do the same work, if not more of it, for less pay.

Perpetuating the problem

In their tunnel vision and dogged determination to save a dollar today, these employers cannot see that by replacing existing workers and with new workers who have been so desperate for so long that they’ll work for much less pay, they are perpetuating spiraling unemployment costs, and those costs are borne largely by none other than the employers themselves.